Fighting homeowners policy cancellations

Imagine having to move out of your house and into a nursing home, or due to job-required traveling, your homeowners insurance is canceled because the insurance company deems your house “unoccupied.”
Surprisingly, many residents throughout the state go through this situation everyday.
Recently, New York State Insurance Department Superintendent Eric Dinallo took action to protect people who face these problems.
He advised insurance companies that canceling a homeowner’s policy only on the basis that the facility is unoccupied is an illegal mid-term cancellation.
Dinallo urged consumers facing this problem to get in contact with the Insurance Department.
“Consumers should know that the Insurance Department will act vigorously to protect homeowners. This includes homeowners who may be involved in forfeiture proceedings, which have increased because of the troubled economy. Insurance companies need to understand that the Insurance Law protects all homeowners from improper non-occupancy cancellations,” Dinallo stated.
The Insurance Department issued a “circular letter” to the insurance industry after receiving numerous complaints from across the state about insurance cancellations.
Among the complaints, there was a Suffolk County woman who had her insurance canceled while trying to sell her home in an effort to move to Albany, even though everything in the home was still in use and her parents looked over the property from time to time.
A man from Plattsburgh, in upstate NY near the Canadian border, was forced out of his home after it was heavily damaged by a fallen tree.
Under the law, a homeowner’s policy must remain in effect for three years from the date the policy starts. Cancellations or non-renewals during the three years are only permitted under circumstances like filing fraud claims, premium non-payment, or applying changes to a property that make it uninsurable.
Non-occupancy may not be considered as the sole factor in a mid-term cancellation. If a policy has been wrongly canceled, insurers must offer to reinstate them and keep the same rates in effect.
“The fact that an uninsured individual is not occupying a home is not a legitimate reason, in and of itself, for canceling a homeowner’s policy. It is improper to cancel a homeowner’s policy simply because a property owner may be away from home because of a situation like an illness,” Dinallo said.
To obtain the circular letter, go to www.ins.state.ny.us/circltr/2008/c108_23.pdf. To file a complaint, go to www.ins.state.ny.us or call 800-342-3736, Monday to Friday, between 9 a.m. and 5 p.m.